Sukkarieh and Secretary, Department of Education, Science and Training

[2006] AATA 446

Administrative

Appeals

Tribunal

 

DECISION AND REASONS FOR DECISION [2006] AATA 446

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No N2005/943

GENERAL ADMINISTRATIVE  DIVISION		)
Re		EYAD SUKKARIEH

Applicant

And SECRETARY, DEPARTMENT OF EDUCATION, SCIENCE AND TRAINING

Respondent

DECISION

Tribunal Ms G Ettinger, Senior Member

Date16 May 2006

PlaceSydney

Decision For the reasons given orally, the decision under review is affirmed.

…………………………………

Ms G Ettinger  Senior Member

CATCHWORDS

SOCIAL SECURITY – financial supplement contract with the Commonwealth Bank – cancellation of the loan by the applicant – whether the applicant owes a debt to the Commonwealth – whether the Tribunal has jurisdiction the recovery of that debt – decision under review affirmed.

LEGISLATION

Social Security Act 1991 – s 1235

REASONS FOR DECISION

16 May 2006	Ms G Ettinger, Senior Member
BACKGROUND

1.      The matter before me is the application of Mr Eyad Sukkarieh (‘the Applicant’).  He has appealed against the primary decision of the Secretary, Department of Education, Science and Training (‘the Respondent’) which was upheld by the authorised review officer of the Secretary, and by the Social Security Appeals Tribunal. 

2.      Mr Sukkarieh, whose birth date is 9 December 1979, has been in receipt of Austudy for some years.  On 12 January 1999 he applied for a financial supplement of $4,000. which constituted a contract with the Commonwealth Bank.  This was granted to him for the customary period which caused it to conclude on 31 May 2004.  He indicated on the form which he completed, and is at T9, that he waived the 14 day cooling off period in which he could cancel the financial supplements contract.  In his evidence he said he didn't really understand what it meant, and he was only 19 at the time.

3.      Mr Sukkarieh told me at the hearing that when he realised the financial supplement was not paid in a lump sum he took the necessary steps, and wrote on 15 January 1999 to cancel the loan.  That document is at T10, and there is no disagreement that Mr Sukkarieh completed it. It was however not actioned correctly and Mr Sukkarieh continued to receive payments.  He said he realised that he was receiving $75 more per period than his usual allowance, but said that he thought that the amount had increased because of the increase in his age.  He said that he made representations to Centrelink about the continuing payments, and eventually by 2 June 1999 they were stopped, but not before he incurred a debt of $1,688.12. By then the first four weeks had also passed during which the repayment would have been to the Commonwealth Bank.  Following that period the responsibility for collection passed to the Commissioner for Taxation. 

ISSUES BEFORE THE TRIBUNAL

4.      Mr Sukkarieh's case before the Tribunal is that he wants that debt, which has now increased to $1,980.12 due to indexation, waived in whole or in part.  He has repaid no part of it at this stage.  The issue is whether Mr Sukkarieh owes a debt to the Commonwealth, and whether this Tribunal has jurisdiction concerning the recovery of the debt.

5.      The relevant legislation is the Social Security Act 1991.  At the time Mr Sukkarieh entered into the contract in 1999, the provisions governing it were pursuant to the Social Security Student Financial Supplement Scheme 1998, established pursuant to section 1061ZX of the Social Security Act 1991.  Since that time, the scheme has been incorporated into the Social Security Act 1991 by amendments in Schedule 1, Part 1 of the Youth Allowance Consolidation Act 2000.  What that means in practical terms for Mr Sukkarieh is that what he entered into continues to be a financial supplement contract which remains a loan from the Commonwealth Bank.  It is however now recoverable through the taxation system.

6. Ms Schuster who appeared for the Secretary, who is the Respondent in these proceedings, prepared a Statement of Facts and Contentions upon which she relied. Ms Schuster submitted that although Mr Sukkarieh owes a debt, it is to the Commonwealth Bank, and that the Commissioner of Taxation would recover it. She submitted that it was not a debt pursuant to section 1235 of the Social Security Act1991 which says that:

1235  Meaning of debt

In this Part, debt means:

(a)       a debt recoverable by the Commonwealth under Part 5.2; or

(b)       a debt under the 1947 Act; or

(c)       a debt due to the Commonwealth under a scheduled international social security agreement; or

(d)       a debt under the Social Security (Fares Allowance) Rules 1998.

7.      There are of course debt waiver provisions in the Social Security Act which the Tribunal can use in some cases.  But they do not apply where the debt is not one to the Commonwealth, but rather has arisen out of a loan by the Commonwealth Bank.  Ms Schuster emphasised that the financial supplement is a loan and not a benefit, or an allowance.  She submitted that repayments are made through the tax system by means of assessment issued by the Commissioner of Taxation. 

8.      She also advised that a person such as the Applicant who has an accumulated financial services debt may apply in writing to the Commissioner of Taxation to ask for a delay in making the assessment, or an amendment to an assessment already made. That decision of the Commissioner is reviewable by this Tribunal, she said, emphasising that there was no reviewable decision in regard to Mr Sukkarieh before the Tribunal at the moment.

9.      In reply to that, Mr Sukkarieh told me that Mr Luke Carter, an advocate of the respondent, had advised him how to make contact with the Commissioner of Taxation, and whom to contact, but that he, Mr Sukkarieh, had not yet done that.  Mr Sukkarieh said that he wanted to first exhaust any other possibilities such as making the application to this Tribunal.  He acknowledged that he has a debt, but said that he has found all the contacts regarding the loan frustrating, and that it “drains me out”.

CONCLUSION

10.     I have considered all the evidence, legislation and submissions, and accept Ms Schuster's submissions as being a correct interpretation of the law.  Accordingly I find that Mr Sukkarieh's application for a financial supplement on 12 January 1999 was a loan from the Commonwealth Bank, and not a benefit or an allowance.  I acknowledge he did the right thing when he attempted to cancel the loan in writing after realising he did not want it because it was not paid as a lump sum.  Unfortunately he indicated on the form that he waived the 14 day cooling off period, and unfortunately the application to cancel the loan was not processed correctly, so he has ended up with a debt which is now at least $1,980.12.  I anticipate that if Mr Sukkarieh contacts the Commissioner of Taxation and explains what has occurred some arrangements can be made to assist him.

11.     In conclusion I confirm that Mr Sukkarieh has incurred a debt with the Commonwealth Bank on the basis of the application he made on 12 January 1999 and that as a result of the effluxion of time and the legislation, that debt is recoverable by the Commissioner of Taxation.  This Tribunal has no jurisdiction to deal with the application. 

DECISION

12.     The decision of the Social Security Appeals Tribunal must be affirmed.

I certify that the 12 preceding paragraphs are a true copy of the reasons for the decision herein of Ms G Ettinger, Senior Member

Signed:         .....................................................................................
  Associate

Date/s of Hearing  16 May 2006
Date of Decision  16 May 2006       
Representative for the Applicant        Self-represented
Representative for the Respondent    Hannelore Schuster